International trade: selling more units need not increase revenue by the same proportion
WTO statistical notes distinguish value, volume and unit value. A simple calculation helps you read these series without confusing their units.
The World Trade Organization’s technical notes distinguish merchandise statistics in value terms, which reflect changes in prices and quantities, from volume statistics, which focus on quantities. They also distinguish unit-value indices. Two export headlines can therefore report different percentages without measuring exactly the same thing.
An example of our own using a single product makes this clear. In a fictional period, one hundred units are exported at ten dollars each: their value is one thousand dollars. In the next period, 120 units are sold at nine dollars each: the value totals 1,080 dollars. Quantity rises by 20%, the price per unit falls by 10%, and the example’s gross revenue rises by 8%. Adding twenty and minus ten does not reproduce the result.
The relationship is clear when the factors are multiplied: 1.20 times 0.90 equals 1.08. This calculation applies to that homogeneous product at the given prices; it does not reproduce how an aggregate WTO index is constructed, combining goods and sources. Nor does it turn export revenue into profit: production, transport, financing costs and taxes have not been included.
When checking a real table, record the unit and period alongside the figure: current dollars, a volume index and a percentage change are not interchangeable labels. Also check whether years, quarters or months are being compared and whether there is seasonal adjustment. A record like this helps you ask a specific question when you encounter different figures, rather than choosing whichever looks more favourable. This explanation uses published methodology; it neither announces a new result for world trade nor forecasts its future path.